HR Insight: An Industry Update

HR Insight: An Industry Update First Analysis Investment Banking September 2012 Industry Focus: Acquisitions Reshape the HR Technology Landscape The HR Software industry has witnessed a series of higher-profile M&A transactions over the past 18 months that mark the arrival of the industry as larger legacy software companies seek to participate in the growth opportunities available within human capital management ( HCM ). Most recently, IBM Corp. can be added to the list of industry giants entering or expanding in the HR software arena. This move puts IBM squarely in the human resources software ring with other big technology players such as Oracle Corp and SAP. Suddenly, the people-management software-as-a-service ( SaaS ) arena has become a contest of some of the largest software companies. Many independent HR software vendors that were industry innovators experienced rapid growth offering SaaS HR applications. As a result, business software firms eager to build or expand their SaaS offerings, such as SAP and Oracle Corp., set their sights on the industry and acquired SuccessFactors and Taleo, respectively. In the wake of this torrent of deal activity, only a few sizable independent vendors remain, such as Cornerstone OnDemand. In the midst of this changing landscape, new players continue to emerge. Potential Impact to Talent Management Technology The continued consolidation and acquisition of HR software vendors by the ERP s may create a commoditization of talent management features in the industry. Innovation may be deemphasized at the expense of integration as acquirers focus on integrating across their product suites. This may create space in the market for new independent vendors to establish themselves with creative solutions. Potential Impact to Public Equity Markets The acquisitions of SuccessFactors, Taleo and Kenexa removed three public companies from what was already a limited universe of public companies in the HR technology sector. As a result, public market options to invest in the HR technology space are now even more limited for those investors looking to participate in this growth market. Chicago, IL 60 First Analysis Corporation One South Wacker Suite 3900 Chicago, IL 60606 312-258-1400 www.firstanalysis.com

Industry Focus (continued) Review of Select Notable HR Technology Deals Target Acquiror Rationale and Comments Aug 2012 Kenexa IBM Part of IBM s strategy to help companies make sense of big data and the emerging social business landscape. Kenexa complements IBM's strategy of bringing relevant data and expertise into the hands of business leaders within every functional department, from sales and marketing to product development and human resources. Mar 2012 Human Concepts Saba Software Signifies Saba's continued focus on the human capital management market and complements existing talent management offering. Saba plans to integrate HumanConcepts' unique Cloud technologies into its unified talent management suite to extend the value of Saba's existing core products. Feb 2012 Taleo Oracle Taleo's portfolio of products would complement Oracle's existing offerings and human capital management has become a strategic initiative for organizations. Taleo extends Oracle's offerings in the growing SaaS arena and gives Oracle another weapon in its duel with SAP as their long-running battle spills into cloud computing. Feb 2012 SuccessFactors SAP SuccessFactors provides immediate credibility in SaaS with a leader in the growing human capital management segment and advances SAP s expansion into SaaS from its traditional on-premise business. In many respects, SuccessFactors is now SAP s cloud platform and a catalyst for its expansion. Dec 2011 Rypple Salesforce.com Rypple advances salesforce.com s social enterprise strategy to human capital management. Salesforce.com plans to re-launch Rypple as Successforce and create a new HCM business unit. The combination creates a rich, integrated enterprise application suite. April 2011 Lawson Software Infor Combining Infor Workforce Management with Lawson Human Capital Management can provide one system to manage all employee-related functions, including core HR, talent management, elearning, time and attendance, and payroll. Source: Company press releases and Capital IQ. Data as of August 31, 2012. Page 2 of 16

Labor Markets The Bureau of Labor Statistics ( BLS ) reported continued slight labor market improvements with non-farm payrolls increasing by 1.8 million from August 2011 to August 2012, yet the unemployment rate remains over 8.0% for the 43 nd straight month and was 8.1% for August 2012. Unemployment, continued global economic uncertainty, and an increasingly onerous U.S. regulatory environment that fosters caution among potential employers, all contribute to creating a very challenging environment for companies across the HR Services and Technology sectors. Monthly Change in U.S. Non-Farm Employment (January 2001 to August 2012) (all employees, in thousands) Monthly U.S. Unemployment Rate (January 2001 to August 2012) 900 700 500 300 100 (100) (300) (500) (700) (900) Jan-01 Jan-03 Jan-05 Jan-07 Jan-09 Jan-11 Jan-13 12% 10% 8% 6% 4% 2% 0% Jan-01 Jan-03 Jan-05 Jan-07 Jan-09 Jan-11 Jan-13 Source: U.S. Bureau of Labor Statistics. Source: U.S. Bureau of Labor Statistics. Industry Stock Market Performance The First Analysis HR Technology Index has outperformed the HR Services Index as well as broader indices over both the long-term (last five years) and nearer-term (last year) periods. 5 Year Indexed Performance (September 2007 to August 2012) 1 Year Indexed Performance (September 2011 to August 2012) 200% HR Services Index S&P 500 HR Technology Index NASDAQ 200% HR Services Index S&P 500 HR Technology Index NASDAQ 150% 150% 100% 102.8% 100% 50% 0% (50%) 16.6% (5.6%) (14.4%) 50% 0% (50%) 43.8% 20.5% 16.8% 2.2% (100%) Sep-07 Sep-08 Sep-09 Sep-10 Sep-11 Sep-12 (100%) Sep-11 Dec-11 Mar-12 Jun-12 Sep-12 Source: Capital IQ. HR Services Index includes: ADP, AON, CBZ, HRB, KELY.A, MAN, NSP, PAYX and TW. HR Technology Index includes: CNQR, INTU, MWW and ULTI. (Excludes WAGE, which was not a public company for most of the period examined.) Page 3 of 16

Public Market Trading Multiples Median public market valuations for companies in the industry are currently 3.90x 2012 consensus estimate revenue for the HR Technology group and 1.09x 2012 consensus estimate revenue for the HR Services Group. 2012E Revenue Multiples HR Technology HR Services 8.05x 7.81x Median Metrics EV / Revenue: 3.90x Revenue Growth: 23.4% 5.15x Median Metrics EV / Revenue: 1.09x Revenue Growth: 3.0% 3.90x 2.43x 1.37x 1.79x 1.25x 0.88x 1.09x 0.53x 1.03x 0.95x 0.72x (1) (1) (1) CNQR ULTI INTU WAGE MWW PAYX ADP AON HRB TW NSP MAN CBZ KELY.A 2012 Projected Revenue Growth 26.0% 23.4% 7.1% 28.4% (8.7%) 5.4% 5.6% 2.3% 3.0% 1.0% 10.3% (6.2%) 3.5% (0.5%) Source: Capital IQ. Data as of August 31, 2012. (1) Reflects EV / 2012E Gross Profit. 2012E EBITDA Multiples HR Technology HR Services 43.2x Median Metrics Median Metrics 33.0x EV / EBITDA: 10.4x EBITDA Margin: 22.2% EV / EBITDA: 6.1x EBITDA Margin: 19.1% 10.4x 6.2x 5.8x 12.2x 11.7x 8.6x 4.5x 5.7x 4.4x 6.1x 6.5x 4.3x CNQR ULTI INTU WAGE MWW PAYX ADP AON HRB TW NSP MAN CBZ KELY.A 2012 Projected EBITDA Margin 24.4% 18.1% 37.6% 22.2% 15.2% 42.4% 20.8% 21.0% 27.5% 19.1% 4.1% 2.6% 11.1% 2.0% Source: Capital IQ. Data as of August 31, 2012. The current HR Technology Index median EBITDA multiple is its five-year and one-year averages, while the HR Services Index median EBITDA multiple is below its five-year average and in line with its one-year average. 5 Year Historical Mean Forward EBITDA Multiples 1 Year Historical Mean Forward EBITDA Multiples 30.0x HR Services HR Tech Service Avg Tech Avg 30.0x HR Services HR Tech Service Avg Tech Avg 25.0x 20.0x Average = 17.7x 25.0x 20.0x Average = 18.2x 15.0x 15.0x 10.0x 10.0x 5.0x 5.0x Average = 7.8x Average = 6.2x 0.0x 0.0x Sep-07 Sep-08 Sep-09 Sep-10 Sep-11 Sep-11 Dec-11 Mar-12 Jun-12 Sep-12 Source: Capital IQ. HR Services includes: ADP, AON, CBZ, HRB, KELY.A, MAN, PAYX, NSP and TW. HR Technology includes: CNQR, INTU, MWW and ULTI. (Excludes WAGE, which was not a public company for most of the period examined.) Page 4 of 16

Industry Merger & Acquisition Activity M&A activity across the sector has been very robust with strategic, and to a lesser extent financial, buyers actively seeking acquisitions. Select strategic buyers continue to suite-up as they try to develop a more fulsome solution suite while financial buyers prefer to look for opportunities where technology is being leveraged to more efficiently deliver services. Select Industry M&A Transactions ( from 10/01/1 to 08/31/12) Status Target Buyer Target Business Description Transaction Value 08/27/12 Kenexa Corp. International Business Machines Corporation Provides SaaS solutions that enable organizations to recruit, retain, and develop employees. $1,396.8 08/21/12 Closed Lewellyn Technology, Evolution Capital Partners Provides training and consulting services to maintenance personnel 08/15/12 Closed Proficient Investigations, PointHR, Inc Conducts comprehensive and affordable pre-employment screening and background investigations. 08/13/12 Closed PeopleShare, Cross X Platform, Provides temporary and contract staffing, temp to hire, direct hire, and flexible staffing services. 08/12/12 Closed Dividend Staffing, MyStaf A staffing firm that places candidates in professional, technical, and executive level positions. 08/09/12 Closed Harris, Rothenberg International, Humana Provides employer and employee assistance programs, work/life services, executive coaching, training, and other services. 08/06/12 Closed Augustine, TalentFusion, Provides recruitment process outsourcing and online research services for recruiters. 08/02/12 Closed Pinstripe, Accel-KKR Provides recruitment process outsourcing services. 07/30/12 Closed McNeely Media, Four Websites PlattForm Advertising, Consists of four truck driving job websites. 07/29/12 Closed Employability & Skills Group Ltd. Ares Capital Corp. Provides training services in the areas of employability and skills for businesses and individuals. 07/18/12 Closed Entrust Great Lakes, Quest IRA, Provides self-directed retirement account administration and education services. 07/17/12 Closed Careerimp, Professional Diversity Network Designs and develops web based software for resume building. 07/09/12 A D Computer Corporation Universal Business Payment Solutions Acquisition Corp. Provides payroll, and payroll tax depositing and filing services. $24.0 Page 5 of 16

Select Industry M&A Transactions (continued) ( from 10/01/11 to 08/31/12) Status Target Buyer Target Business Description Transaction Value 07/03/12 Closed Allines, EmployBridge, Provides temporary, temporary to permanent, and straight permanent staffing services. 07/03/12 Closed Sidles Duncan & Assoc. Insurance Services Hub International Insurance Services Operates as an employee benefits consulting and brokerage company. 07/02/12 Closed Miller Buettner & Parrott, Arthur J Gallagher & Co. Operates as an employee benefits consulting services company in Northern Illinois. 07/02/12 Closed Glotel, and Idea Integration, Corp. The Gores Group Glotel portion provides workforce resources and solutions in the telecom and IT sectors. 06/29/12 MJO Staffing, Pathway Staffing, MJO Staffing, provides temporary and permanent employee staffing services. 06/25/12 Closed Invita Healthcare Staffing Corporation Accountable Healthcare Holdings Corp. Provides per diem, travel contract and placement of healthcare professionals in clinical modalities. 06/18/12 Closed The Human Capital Initiative The Human Capital Group, Provides people powered solutions and HR services for organizations in Georgia. 06/08/12 Closed Cambridge Staffing, QPS Employment Group, Provides staffing, temporary job, termination, and testing services. 06/07/12 Effective Beacon Services, Elwood Staffing Services, Provides staffing, computer training, and human resource consulting services. 06/06/12 Closed Grossman & Associates, Arthur J Gallagher & Co. Provides employees benefits consulting services. 06/06/12 Closed BANKtemps Workway, Provides staffing services to the financial services industry. 05/31/12 Closed AllCountyJobs.com OperationsInc, Operates a network of local and industry-specific online job boards. 05/31/12 Closed The Javers Group, Univest Insurance Provides HR management and benefits outsourcing services. $5.0 05/23/12 Closed TalentFirst, Employer Consultancy, Develops and embeds talent management solutions. 05/22/12 Closed Silverchair Learning Systems, Vista Equity Partners Provides training and education for employees in home health agencies and skilled nursing, assisted living, continuing care facilities. 05/15/12 empowhr, Quadrant 4 Systems Corporation Provides solutions to engage and connect employees with online access to HR, benefits, wellness, and financial information. 05/15/12 Closed Temporary Professionals, Employment Control, Provides temporary staffing services. Page 6 of 16

Select Industry M&A Transactions (continued) ( from 10/01/11 to 08/31/12) Status Target Buyer Target Business Description Transaction Value 05/14/12 Sustainable Practices, KleanJobs.com Owns and operates CleanTechRecruits.com online job search portal. 05/13/12 Closed Extend Health, Towers Watson & Co. Provides health benefits management services, operaing as a private Medicare insurance exchange. $435.0 05/11/12 Farin & Company GmbH CTPartners Executive Search Farin & Company GmbH, an executive search company, provides talent management services. It focuses on recruiting, development, and corporate learning. The company was founded in 2010 and is based in Hamburg, Germany. 05/10/12 Closed Primarily Care, CBIZ, Operates as a health and lifestyle management company that provides employer sponsored programs. 05/10/12 Closed Benefit Concepts of Indiana Neace Lukens, Provides employee benefits consulting services in Indiana. 05/09/12 Closed Patterson Associates LLP Pearl Meyer & Partners, Provides remuneration advisory services to companies outside North America. 05/08/12 Closed Houston Operations of the Eastridge Group of Staffing Companies Atterro, Provides customized staffing solutions for the manufacturing, assembly, and distribution industries. 05/07/12 Closed 6FigureJobs.com, Callidus Software Offers online job search resources and content for job seekers and recruiters. $1.1 05/04/12 Closed Computerized Payroll Solutions, Inova Payroll, Provides payroll and HR services, including background checks, HR audit, executive search, and outplacement services. 05/01/12 Closed CompuPay BenefitMall, Provides payroll services including payroll processing, tax services, 401(k), background screening and other. 05/01/12 Closed Socialtext, Peoplefluent, Offers an enterprise collaboration platform that enables employees to share expertise and speed workflows. 04/30/12 Closed Kansas City operations of SOS Staffing Svcs QPS Employment Group, Offers staffing services. 04/26/12 Closed Staffing Specialists, Doherty Staffing Solutions, dba Job Jockeys, offers staffing and recruiting services for clerical and light industrial. 04/26/12 Closed Accord Human Resources, TriNet Group, A PEO providing outsourced human resource management solutions. 04/25/12 Closed Language Jobs Ltd. CareerBuilder, Operates a European network of job boards for professionals with linguistic skills. Page 7 of 16

Select Industry M&A Transactions (continued) ( from 10/01/11 to 08/31/12) Status Target Buyer Target Business Description Transaction Value 04/25/12 Closed John Morley Presentations Limited Terryberry Company, Provides reward and recognition services. 04/24/12 Proteus Networks, Torrey Point Group Offers education and professional training and consultative services in Juniper Networks. 04/19/12 Closed Arnold & Company, David K. Young Consulting, Provides retirement and benefit solutions. 04/19/12 Closed BackCheck Information Corporation Sterling Infosystems, Provides pre-employment background screening solutions and services in Canada. 04/18/12 Closed Careers in the Fire Service Praetorian Group, Provides firefighter employment and hiring information services. 04/17/12 Closed Smart Computer Holdings Ltd. Kronos Incorporated Offers solutions to manage time and attendance, staff scheduling, and absentees. 03/28/12 Prompt Holdings CVC Capital Partners Ltd. Provides staffing services in North America, Europe, Asia, Australia, and internationally. 03/20/12 Closed Apex Systems, On Assignment Provides IT staffing services. $693.7 03/20/12 Closed HumanConcepts, Saba Software, Provides software to enterprises to manage organizational changes of growth, rightsizing, and reorganization. $23.5 03/19/12 Closed Iron Gate Workforce, Workforce Insight, Operates as a healthcare workforce management technology services company. 03/19/12 Closed Kforce Clinical Research inventiv Health, Provides clinical trial resourcing solutions. $50.0 03/13/12 Closed KSPH Thomas Rutherfoord, Provides employee benefit management services. 03/08/12 Closed SHPS Human Resources Solutions Automatic Data Processing, Provides human resource and general management services. 03/08/12 Closed Sonar Limited Cornerstone OnDemand, Designs and develops online performance management and succession planning software solutions. $13.5 03/06/12 Closed FirstChoice Administrators HealthSmart Holdings, A TPA that provides insurance, administration, and consulting services to employers. Page 8 of 16

Select Industry M&A Transactions (continued) ( from 10/01/11 to 08/31/12) Status Target Buyer Target Business Description Transaction Value 03/01/12 Closed Payroll Solution Payroll Specialties Provides payroll services. 02/28/12 Closed escreen, Alere Technology-enabled TPA that provides Web-based employment screening applications for hiring and maintaining workforces. $340.0 02/28/12 Closed Selected Assets of Peak Counsel On-Call Counsel, Comprises attorney and paralegal staffing services. 02/27/12 Closed Addison Group, Addison Search Ventures, Provides staffing services. 02/22/12 Closed Kane Partners, Brown & Brown of Connecticut, Provides benefits administration services. 02/17/12 Closed e-verifile.com, Yucaipa Cos.; Frontier Capital; Magic Johnson Ent.; Plexus Capital Provides risk assessment, administrative support, and workforce solutions. 02/16/12 Closed Employment Control, Claritas Capital; Harbert Mezzanine Partners; Claritas Capital Provides commercial temporary staffing services. 02/14/12 Closed USA Staffing, QPS Employment Group, Provides staffing services on a temporary, long-term assignment, and contract-to-hire basis. 02/09/12 Closed Taleo Corp. Oracle Corporation Provides on-demand talent management software solutions. $1,921.4 02/07/12 Closed Valtera Corporation Corporate Executive Board Co. Provides human capital consulting and technology solutions. $24.3 02/06/12 Closed OutStart, Kenexa Corp. Provides formal and on-demand learning, knowledge sharing, and community/expert collaboration solutions. $83.9 02/01/12 JM Beigbeder & Partners CEO Search CTPartners Executive Search Provides leadership recruitment and consulting services. 02/01/12 Closed Panhandle Correctional Care, Conmed Healthcare Management, Provides medical professionals staffing services to healthcare facilities. 01/31/12 Closed Strategia Communications Peoplefluent, Offers Web-based learning, skills, and compliance management solutions. Page 9 of 16

Select Industry M&A Transactions (continued) ( from 10/01/11 to 08/31/12) Status Target Buyer Target Business Description Transaction Value 01/23/12 Closed Military Transitions The Buller Group, Provides human capital solutions focused on recruiting, managing, and retaining military veterans. 01/16/12 Closed Regional Internship Center of Southwestern Pennsylvania Careerimp, Operates as an online clearing house connecting internship seekers and employers in Southwestern PA. 01/16/12 Closed Ma Foi Consulting Solutions Ltd. Automatic Data Processing, Provides HR management and consulting services to various companies in India and internationally. 01/12/12 Closed Janou Pakter JBCHoldings NY Provides executive search and creative recruitment services. 01/09/12 Closed WorkforceLogic APC Workforce Solutions, Operates as a workforce management company. 01/09/12 Closed Icon Time Systems, Paychex, Provides time and attendance solutions, specializing in time clocks for small and medium businesses. 01/05/12 Closed Choice Strategies, WageWorks, Provides debit card based and non-debit card based consumer driven health plans administration services. $19.8 01/05/12 Closed Benefits and Retirement Business of Advantage Benefit Planning CBIZ, Comprises employee benefits and retirement book of business and provides benefits consultation and customer services. 01/04/12 Closed Advantage Resourcing America and Advantage Resourcing Europe Recruit Co., Ltd. Provides commercial and technical staffing services. $410.0 12/31/11 Closed NAS Recruitment Communications Stone-Goff Partners Provides HR communication solutions. 12/15/11 Closed Alchemy Search Partners, SOAProjects, Provides direct hire and interim search services. 12/14/11 Closed WG Ross Corporation ADI Software, Provides workforce management solutions. $4.5 12/12/11 Closed Stone Partners, Frost Insurance Agency, Provides human resource consulting and outsourcing services. 12/07/11 Closed Stanley Security Solutions (Pty) Ltd. EOH Holdings Limited Develops and sells workforce data management, security, and telecommunications solutions. 12/06/11 Closed Jobs2Web, SuccessFactors, Provides interactive recruiting and career site optimization solutions. $111.9 Page 10 of 16

Select Industry M&A Transactions (continued) ( from 10/01/11 to 08/31/12) Status Target Buyer Target Business Description Transaction Value 12/05/11 Closed HR Solutions International, Avatar International Workplace survey design, implementation, analysis, and action planning services to build engagement and increase retention. 12/03/11 Closed SuccessFactors, SAP America, Provides cloud-based business execution solutions that enable organizations to bridge gap between strategy and results. $3,764.4 12/02/11 Closed KilaKila Employer Services ALTRES, Provides employee administration services in Hawaii. 11/25/11 Closed TS Staffing Services, Corporate Resource Services, Offers temporary employment staffing services in the areas of light industrial and administrative support. $81.6 11/16/11 Closed Tradição Tecnologia e Serviços Ltda. Kelly Services, Employment solutions including temporary staffing, permanent placement, executive search and training throughout Brazil. 11/14/11 Closed Batrus Hollweg International Selection Services, Limited Kenexa Corp. A talent-management consulting company that enables companies to hire, develop, and retain the right people. $17.2 11/08/11 Closed Fringe Benefit Administrators, Ltd. Lincoln Trust Company Operates as a retirement benefit company. 11/04/11 Closed Employee Benefits Division of Kaeding, Ernst & Co. The Bostonian Group Incorporated Offers employee benefit services. 10/31/11 Closed HRS/TND Assoc. The Securus Dunlop Group Provides human resource consulting and outsourcing services and programs. 10/24/11 Closed Hirsch Financial Services, Total Administrative Services Corporation Provides flexible spending account and COBRA administration services. 10/18/11 Closed Wells Fargo Third Party Administrators, HealthSmart Holdings, Provides employee benefit plan administration services. 10/17/11 Closed Staffmark Holdings, Recruit Co., Ltd. Provides various staffing services. $295.0 10/13/11 Closed Open Wave Pty Ltd. Noble Systems Corporation Provides workforce management solutions for forecasting and staff scheduling. 10/10/11 Closed The RightThing, Automatic Data Processing, Provides recruitment process outsourcing solutions. 10/03/11 Closed ADI Time Asure Software, Develops cloud computing time and attendance management softwareas-a-service. $7.1 Source: Capital IQ and public announcements. Data as of August 31, 2012. Page 11 of 16

Recent Industry Private Capital Raising Activities Venture and growth capital providers continue to seek opportunities to deploy capital in the HR sector as industry changes create opportunities for new and disruptive technologies to achieve significant growth over the next several years. The sector continues to attract the interest of investors, and larger private companies are likely to pursue future sales and public market options, including potential IPOs. Select Industry Private Placements ( from 10/01/2011 to 08/31/2012) Offer / Close Status Company Primary Feature (Details) Target Business Description Amount Raised 08/24/12 -- ecareer, Venture Capital Develops career Websites in the U.S. and India. $6.0 08/23/12 -- GuideSpark, Venture Capital (Convertible Debt; Mezzanine; Multiple Provides benefits and open enrollment communication, new/pre-hire training, and financial wellness services. $1.2 08/10/12 -- The Right Staff Lifestyle Management Venture Capital Provides household staffing, corporate staffing, and consulting services. $0.2 08/08/12 -- St Joseph (OTCBB:STJO) PIPE Recruitment and placement of professional technical, fianance and accounting personnel. $14.0 07/20/12 -- MBA Focus, Growth Capital/Private Equity Provides recruitment technology solutions. $1.0 07/10/12 07/24/12 Closed HigherNext, Venture Capital Offers a business knowledge and skills test and credentialing program for job candidates. $0.8 07/10/12 -- INTERNMATCH, INC. Venture Capital Provides online platform to streamline the process of recruiting interns. $2.8 06/13/12 06/22/12 Closed ManpowerGroup (NYSE:MAN) Private Placement of Senior Notes Provides workforce solutions and services worldwide. $438.3 06/07/12 06/07/12 Closed Will Be Hired, Venture Capital (Convertible Debt; Mezzanine) Operates a job seeker site. $1.0 06/01/12 -- Effective erecruit Holdings, Venture Capital (Minority Stake; Reg D) Provides staffing firm management solutions for contract/temporary and direct hire businesses. $0.4 05/23/12 -- Roving Coach International, Venture Capital (Convertible Debt; Mezzanine; Reg D) Provides employee engagement and coaching services. $0.1 05/14/12 -- HigherNext, Venture Capital (Convertible Debt; Mezzanine; Multiple Offers a business knowledge and skills test and credentialing program for job candidates. $0.2 Page 12 of 16

Select Industry Private Placements ( from 10/01/2011 to 08/31/2012) Offer / Close Status Company Primary Feature (Details) Target Business Description Amount Raised 05/01/12 05/01/12 Closed BenefitMall, Growth Capital/Private Equity Provides integrated employee benefit solutions. $100.0 04/30/12 04/30/12 Closed Chrome River Technologies, Growth Capital/Private Equity (Convertible Equity; Mezzanine; Minority Stake; Multiple SaaS financial applications focused on expense reporting and invoice management automation. $3.0 04/19/12 -- HRO Partners Venture Capital Provides human resource business process outsourcing services. $0.1 04/10/12 -- Effective ContactPoint, Growth Capital/Private Equity (Minority Stake; Reg D) Provides sales and service training services for associations and companies. $1.3 04/04/12 04/24/12 Closed Liazon Corporation Venture Capital (Minority Stake; Reg D) Operates a private benefits exchange. $18.2 03/30/12 -- Effective KnowledgeAdvisors, Growth Capital/Private Equity (Convertible Debt; Mezzanine; Reg D) Provides learning and talent measurement solutions. $1.5 03/28/12 05/14/12 Closed SilkRoad Technology, Growth Capital/Private Equity (Convertible Equity; Foreign Investment; Mezzanine; Minority Stake; Multiple Tranches; Pre-IPO; Reg D) Provides talent management solutions. $35.0 03/09/12 03/09/12 Closed The Bartech Group, Growth Capital/Private Equity Sourcing, recruitment, placement, and retention of technical and other professional staff. $0.0 02/07/12 -- Effective Matchpoint Careers, Venture Capital (Convertible Debt; Mezzanine; Reg D) Provides online psychometric-based job matching services to job seekers and employers. $0.5 02/07/12 05/24/12 Closed Fullbridge, Venture Capital (Individual Investors Participated; Minority Stake; Multiple Provides business education programs. $5.5 02/01/12 02/01/12 Closed RiseSmart, Venture Capital Provides outplacement and career transition services and solutions. $2.0 01/31/12 01/31/12 Closed Stormwind,. Venture Capital (Individual Investors Participated; Minority Stake) Provides IT training services. $4.0 01/30/12 01/30/12 Closed GetHired, Venture Capital (Individual Investors Participated; Minority Stake) Operates GetHired.com, a hiring platform for smalland medium-sized businesses. $1.8 Page 13 of 16

Select Industry Private Placements ( from 10/01/2011 to 08/31/2012) Offer / Close Status Company Primary Feature (Details) Target Business Description Amount Raised 01/25/12 -- Effective EV Holdings, Venture Capital (Minority Stake; Reg D) Provides web-powered employee screening solutions and support systems. $23.6 01/25/12 01/25/12 Closed e-verifile.com, Growth Capital/Private Equity Provides risk assessment, administrative support, and workforce solutions. $0.0 01/24/12 01/24/12 Closed Elance, Growth Capital/Private Equity Online employment platform to hire and manage programming, marketing, creative, and administrative contractors in the cloud. $16.0 12/31/11 -- Effective TowerMetrix, Venture Capital (Minority Stake; Reg D) Provides employee performance management software solutions. $0.8 12/31/11 12/31/11 Closed JobSync, Venture Capital Operates an online service that matches candidates to job opportunities. $0.0 12/07/11 -- OneWire Venture Capital Provides career management and networking tool that helps candidates be matched to opportunities. $28.9 11/23/11 11/29/11 Closed WorkForce Software, Venture Capital (Mezzanine; Minority Stake; Reg D) Provides software and SaaS based workforce management solutions. $17.0 11/22/11 -- Effective FieldSolutions, Venture Capital (Convertible Debt; Mezzanine; Minority Stake; Multiple Provides field service technicians to the electronics industry in North America. $2.3 11/17/11 -- JobSync, Venture Capital Operates an online service that matches candidates to job opportunities. $2.0 11/07/11 11/07/11 Closed KPA, Growth Capital/Private Equity Environmental, health, safety, and HR compliance and risk management solutions. $5.0 11/07/11 -- BoardProspects, Venture Capital (Individual Investors Participated; Minority Stake; Multiple Provides BoardSearch tool that allows prospects and boards to find each other. $0.8 10/28/11 -- AfterCollege, Growth Capital/Private Equity Operates a Web-based employment/online career network for college students and recent grads. $0.8 Page 14 of 16

Select Industry Private Placements ( from 10/01/2011 to 08/31/2012) Offer / Close Status Company Primary Feature (Details) Target Business Description Amount Raised 10/25/11 10/25/11 Closed Solv Staffing, Venture Capital Provides workforce management and staffing solutions. $0.0 10/13/11 -- Effective Workday, Growth Capital/Private Equity (Minority Stake; Reg D) Provides enterprise cloud-based applications to optimize financial and human capital resources. $98.6 10/13/11 -- Hilo, Venture Capital Operates online job portal. $0.6 10/05/11 -- St Joseph (OTCBB:STJO) PIPE Recruitment and placement of professional technical, fianance and accounting personnel. $0.2 10/04/11 10/04/11 Closed Start Labs, Venture Capital Source: Capital IQ and public announcements. Data as of August 31, 2012. Development stage co. that will develop solutions for job seekers, employers, and recruiting vendors. $3.3 Recent Industry Public Capital Raising Activity The U.S. IPO market picked up in the early part of 2012, but has been slipping between dormant and near-dormant over most of the year-to-date period following Facebook's troubled initial public offering in mid-may with only select companies being welcomed by investors. In addition, poor jobs reports and continued concerns over the economic situation in Europe, if not globally, create an environment that makes it more challenging for companies to test the public markets. Select and Pending Industry Public Offerings ( or Closed from 10/01/2011 to 08/31/2012) Initial Filing Offer Status Company Primary Feature (Security Type) Company Description Amount Raised 08/30/12 Workday, IPO (Common Stock) Applications to manage business functions that optimize financial and human capital resources. $400.0 06/28/12 06/28/12 Closed Ceridian Corporation Fixed-Income Offering (Corporate Debt, Non- Convertible) Provides outsourced processing and employee benefits services. $720.0 05/22/12 Professional Diversity Network IPO (Common Stock) Operates a networking site and job board for Spanish, Hispanic, Latino and bilingual professionals. $17.5 01/05/12 Extend Health, IPO (Common Stock) Provides health benefits management services. $75.0 04/25/11 05/09/12 Closed WageWorks, (NYSE:WAGE) IPO (Common Stock) Operates as an on-demand provider of tax-advantaged programs. $58.5 Source: Capital IQ and public announcements. Data as of August 31, 2012. Page 15 of 16

About First Analysis Investment Banking Founded in 1981, First Analysis has a 30 year track record of serving emerging growth companies and established industry leaders within its focused areas of domain expertise. Our investment banking practice leverages industry insights developed through our equity research and private equity activities to deliver value to clients across the life cycle of a business. Providing senior level attention to every client, First Analysis offers superior execution across a comprehensive range of investment banking services, including M&A advisory, public equity and debt financing, and private equity placements. First Analysis Securities Corporation One South Wacker Drive, Suite 3900 Chicago, IL 60606 www.firstanalysis.com Matt Nicklin (312) 258-7181 mnicklin@firstanalysis.com Paul Johnson (312) 258-7180 pjohnson@firstanalysis.com Brian Friedman (312) 258-7110 bfriedman@firstanalysis.com This report has been prepared by the Investment Banking Department of First Analysis Securities Corporation and is provided for informational purposes only. This report is an overview and analysis of trends and is not intended to provide investment recommendations on any specific industry or company. Neither the information nor any opinion expressed constitutes a solicitation by us of the purchase or sale of any securities. This is not a complete analysis of every material fact regarding any company, industry, or security. The opinions expressed herein reflect our judgment at this date and are subject to change. The information has been obtained from sources we consider to be reliable, but we cannot guarantee the accuracy. Past performance and any projections herein should not be taken as an indication or guarantee of future performance. First Analysis Securities may act as financial advisor and/or underwriter for companies mentioned in this report. This report may contain information which was previously included in a First Analysis Research Report. A complete listing of all companies covered by First Analysis Equity Research and applicable research disclosures can be obtained by calling 1-312-258-1400 or writing to: First Analysis Securities Corporation, Equity Research, One South Wacker Drive, Suite 3900, Chicago, IL 60606. First Analysis Securities Corporation is a registered broker/dealer with FINRA and member SIPC. Page 16 of 16